Ten years to FDA approval is a feature, not a bug.

Excerpt — Letter to LPs, Q3 2026

On pacing, the closed IPO window, and reading the papers.

We closed Fund III in March 2024 with a deliberately small mandate: twenty-two seed checks over four years, no follow-ons larger than our pro rata, no thematic funds, no scout program. We have written eleven of those checks. We expect to write the remaining eleven slowly. ¹

The biotech consensus this quarter is that the IPO window is closed and the M&A window is narrow. We agree on the first and disagree on the second. ² Pharma R&D productivity is at a fifteen-year low and the patent cliff between 2027 and 2030 is roughly $250B in branded revenue. The acquirers we know are not waiting on capital markets to tell them which assets to buy. They are waiting on Phase 1 readouts.

We continue to underwrite preclinical assets on a ten-year horizon to first commercial sale. We continue to decline founders whose deck leads with a market-size slide. We continue to read the papers — ours and our competitors’ — and to write our diligence memos as if we were going to publish them. ³

1. 1Fund III pacing schedule, Appendix A of the Q1 2026 LP letter. Available to LPs on request.
2. 2See Evaluate Pharma, "Pharma R&D Productivity Index," Mar 2026; and the analysis in our Q2 2026 letter, pp. 14–19.
3. 3Our diligence template (v3.2) is open-sourced on the Codon Notes blog. Comments welcome from peer funds.